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Fraud cases prey on economically distressed
MADISON, Wis. (3/20/09)--Fraudsters are having a field day with consumers during the recession, as credit unions receive alert after alert about members and others who took the bait and found out the deal was too good to be true. During times of economic turmoil, consumers are especially vulnerable to fraud. This year, there are some new frauds. This report excludes phishing, vishing and smishing scams--News Now reported those on March 19. Here are the latest schemes:
* Consumers are being victimized while attempting to buy vehicles on the Internet, reports the Federal Bureau of Investigation (FBI). The victims find low-priced cars or trucks on Web classified ad sites. In a new twist, some scammers pose as members of the military who must sell the vehicle quickly and cheaply because they are being deployed overseas. Many scams include a third-party vehicle protection program to ensure a "safer" transaction. Victims are directed to send full payment, or a percentage, to the agent via wire. But no vehicle arrives. Credit unions can advise members to do as much due diligence as possible on such transactions and pay attention to the website's rules. If someone asks a member to break the site's rules, it is possibly a scam (LoneStar Leaguer March 11) . * There have been several incidents of fraudulent cashier's checks and members taken in by "Cash for Gold" advertisements in Pennsylvania, according to the Altoona (Pa.) Chapter of Credit Unions (Life is a Highway March 13). * Residents in Reading, Pa., have been targeted by work-at-home scams. These are especially popular during times of high unemployment. A letter from an entity purporting to be Truenorth Monitoring and Research Services of Quebec, Canada, informs the victims that based on a previous survey with Consumer Survey Specialist, they indicated an interest in part-time income. The letter offers employment as a Mystery Shopper to serve as a Consumer Service Evaluator of select retail stores. The victims would make purchases at the stores and evaluate the provider on a probationary basis. An application and a counterfeit check for $3,975 accompany the letter. The fraudsters aim to have the victim deposit the check, spend $150 at a retail store, then send money to another location via Western Union/Moneygram (Life is a Highway March 16). * Retirees attempting to recover from market losses are especially vulnerable to financial or investment scams, says Brent Neiser, certified financial planner and director with the National Endowment for Financial Education (NEFE) (LoneStar Leaguer March 12). According to the Securities and Exchange Commission, investment scams commonly used include: high-return or "risk-free" investments; pyramid schemes; "ponzi" schemes; promissory notes; Internet investment fraud; and affinity fraud. Credit unions should tell members to thoroughly research any person, organization or company that offers financial planning or investment advice or sells products or services. They should say no if seller: guarantees results; is in a hurry to close the deal; makes the offer via an unsolicited telephone call, post card or e-mail; or promises huge crude oil profit--a scheme particularly popular in Texas (LoneStar Leaguer March 13).
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